Mizrahi Tefahot Bank (TASE:MZTF) is set to become Israel's second largest bank in terms of the number of branches. This conclusion can be drawn by examining the major banks' 2016 financial results and streamlining plans.
At the moment Mizrahi Tefahot is Israel's fourth largest bank in terms of branches with 184 branches – behind Bank Hapoalim (TASE: POLI) with 235 branches, Bank Leumi (TASE: LUMI) with 203 branches and Israel Discount Bank (TASE: DSCT) with 200 branches. This after Hapoalim closed 41 branches in the past four years, Leumi also closed 41 branches and Discount closed 26 branches. But over the same period between 2012 and 2016, Mizrahi Tefahot added nine new branches.
This trend will continue in the future as most customers perform their banking online. Visits to a branch will only be required for the most complex transactions as well as mortgages and financial and investment consultancy.
But while Leumi, Hapoalim and Discount plan more branch closures, Under CEO Eldad Fresher, Mizrahi Tefahot's strategic plan, which it presented several months ago, calls for opening 3-5 new branches each year, so that in five years time Mizrahi Tefahot will have well over 200 branches. At the same time, Leumi and Discount have declared that they will close 10 branches per year in the coming few years. This means that Mizrahi-Tefahot is set to overtake these two in terms of the number of branches, leaving Mizrahi as the second largest bank after Hapoalim.
Hapoalim, which will remain the largest bank, has been closing ten branches per year over the past four years, but will now slow this pace. It is also focusing on expanding in Israel's Arab sector, where it opened three new branches last year, bringing the number of its branches in this sector to 28, and this process will continue in the coming years.
Published by Globes [online], Israel business news - www.globes-online.com - on April 20, 2017
© Copyright of Globes Publisher Itonut (1983) Ltd. 2017
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